Independent Schools Queensland yesterday released a report it commissioned from AEC Group on the economic contribution of its 190 member schools (i.e. non-Catholic private schools) to Queensland, revealing a direct contribution of over 14,000 jobs and $1.8 billion in gross state product (0.6% of total GSP). As is usual in economic contribution studies, much is made of the estimated indirect impacts, production and consumption-induced economic activity (see figure above), but as the calculation of these impacts is controversial and the usefulness of the estimates (particularly the consumption-induced impacts) is debatable, I will refrain from getting too excited about them.
In my view, the really interesting aspect of the study is the estimated savings to taxpayers from independent schools. While private schools receive some public funding, largely from the Commonwealth Government, as you would expect, it is much less per student than funding to state schools, implying a saving to taxpayers when students move from state to private schools. The report notes:
Independent schools are estimated to have saved tax payers a total of $1.02 billion in 2013-14, through a combination of savings of $804 million in recurrent education costs and $218 million in capital costs.
This raises in my mind the messy and sub-optimal funding arrangements we currently have for schooling in Australia, involving a mixture of grants for different purposes from State and Federal Governments. Ideally, we would have some sort of means-tested voucher for schooling, so government funding per student is not affected by the choice of school, and to promote greater competition among all schools, with efficiency gains likely flowing from that. This would require substantial Commonwealth-State cooperation to implement and hence is very unlikely to ever occur.
I recall that, last year, at least one courageous public servant from the Queensland Department of Premier and Cabinet tried to get the State Government to consider school funding reform, raising the idea of co-payments for state schools, but alas that effort was not well received by the Government (see Qld Government denies plan for public school fees).
For more on school funding, see my previous posts: